Cautious support for proposed reforms to homebuying process

In particular, it recommended an ‘urgent’ review of referral fees, citing concerns that many estate agents are not being transparent. It supports the proposal for a code of practice for estate agents, mandatory training and certification.

The government’s ‘Home buying and selling reform’ consultation, which closed last month, made a variety of proposals to speed up sales, including binding conditional contracts, tighter controls on agents and an extensive list of information requirements at the marketing stage.

In its response, CILEX highlighted ‘inefficiencies and process bottlenecks’ caused by low-fee business models that place conveyancing lawyers under substantial pressure, facing ‘unprecedented strain, relentless workloads and tight profit margins’. It called for a review of conveyancing fees alongside the reforms to ensure firms do not overcommit to too-high caseloads. Any increase in costs would be outweighed by improvements to client care and efficiency, it said.

CILEX warned of ‘frustration and disjointed communication’ occurring between different representatives when property sales rely on everyone in the chain falling into place. It recommended the Legal Services Board take ‘collaborative regulatory action’ with support from frontline regulators.

CILEX president Sara Fowler said: ‘It is imperative that in pursuit of speedier transactions there is no compromise on quality of service and that consumers get the expert advice they need.

‘The government’s proposals offer much needed change to the sector but if the reforms are to be a long-term success, we need to see strong regulation and education, a review of current fee structures and transparency on referral fees to ensure that consumer protection is at the heart of these reforms.’

The Council for Licensed Conveyancers (CLC) also backed ministers’ plans to regulate estate agents and to require more material information upfront during the marketing process.

Both CILEX and the CLC gave cautious support for binding conditional contracts. CILEX said more work was needed to establish the practicalities involved, particularly where properties are in a chain. The CLC said allowance must be made for ‘fair withdrawal’.